FTSE 100 technical analysis for 23rd August 2023
The FTSE 100 closed in the green, snapping its worst run in four years as the mood improved following lower-than-expected government borrowing and an easing of a bond-market sell-off. Britain’s blue chip index closed 0.18pc higher at 7,270.76, while the FTSE 250 midcap index finished up 0.7pc at 18,024.26.
Asian equities traded mixed as Wall Street’s risk-on mood faded a day after the rally in big tech. Mainland Chinese stocks returned under pressure despite fresh signs of an earnings recovery among the country’s tech giants. Hong Kong shares edged higher, while those in Shanghai and Shenzhen fell, following a sudden rally Tuesday. Benchmark gauges in Japan and Australia held on to modest gains.
Asian shares held tight ranges on Wednesday as investors awaited results from tech darling Nvidia to see if the sector's lofty valuations can withstand a jump in bond yields, while still gloomy factory readings from Japan left sentiment fragile.
S&P 500 futures climbed 0.3% while Nasdaq futures rose 0.4%. Overnight, Wall Street was hit by higher yields which hit fresh 16-year highs.
FTSE 100 technical analysis for today
Once again a slight overshoot of the resistance levels before the bears appeared yesterday to drive the price down. As I expect you know it's eyes on the Nvidia results today and we may well see a rise today ahead of them after the bell. The FTSE100 is looking more positive this week and has decent support to start with at the 7275 daily pivot level.
I would like to see this hold today really for a push up to the first main resistance area at 7330, and ideally a test of the daily resistance level at 7355 today as well.
Above this then the bulls will be looking to test the 7400 area and ultimately, as mentioned previously, the 7440 area where we would have the first test of the daily 25ema. We may well see this before the end of the week.
On the bearish side, a break of the 7275 level will likely see a slide down to the 7240 area where we have the 2h support levels in play - and a long here would also be worth trying, but get the stop to breakeven asap as per usual.
Below that then the S3 level at 7200 would be the next magnet though that would be a bit of a bearish session today and I am thinking that we are more likely to rise today.
The S&P500 has defended the move below 4400 yesterday and the bulls have just about got it back here. As such, we could see any dips on that today get defended again, especially as the 2h chart is bullish with 4373 support from the coral and the Hull MA. A long here is also worth a go. 4420 is the level that the bulls will need to break for a push towards the 4445 area and a test of R2.
So, watching to see if the FTSE100 bulls can break above the 7330 level initially. So far this week the candles show that the rallies get sold (long wicks) but the buying appetite is still there.
Good luck today.
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